(News Bulletin 247) – US stocks were hesitant on Wednesday, with investors still appearing disconcerted by the unreassuring remarks made the day before by the Chairman of the Federal Reserve.
At the end of the morning, the Dow Jones fell 0.3% to 32,746.7 points, while the Nasdaq Composite rebounded modestly by 0.2% to 11,554.4 points.
Investors are still accusing the blow of the confirmation that the Fed is beginning to consider accelerating its monetary tightening in order to better control inflation.
The president of the institution said yesterday that, provided that the economy continued to improve, the central bank could intensify its rate hikes to bring them to higher levels than expected.
‘This marks a ‘pivot’ in the central bank’s monetary policy, but not in the direction the markets were hoping for’, comments a trader.
A new hearing by the Fed chief, this time before the Financial Services Committee of the House of Representatives, gave rise to the same reactions this morning.
The Fed Chairman’s statements initially supported the dollar and weighed on commodities, on which investors have largely unwound their positions over the past 24 hours.
The barrel of American light crude oil (WTI) continues to decline this morning, yielding 1.5% to 76.4 dollars despite the announcement of a slight decline in crude oil inventories last week.
The dollar is stabilizing after having risen sharply the day before, driven by the prospect of seeing the central bank further tighten its monetary policy.
As for rates, bond yields eased a little after the sharp upheavals known at the start of the week, with ten-year Treasuries dropping around five points to around 3.92%.
Investors also remain attentive to the economic indicators of the day, and in particular to the figures relating to the labor market.
According to ADP, the private sector thus created 242,000 jobs in February, a figure higher than expected due to the dynamism of the leisure and hospitality, finance and manufacturing industry sectors.
The recognition of better employment is obviously interpreted as going in the direction of monetary tightening, a scenario that Jerome Powell himself evoked during his speech before Congress.
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